topic Re: Aging milestones for BK? in Bankruptcy

Aging milestones for BK?

rosco75 — Mon, 06 Mar 2023 16:01:17 GMT

Hello all. I know that with many neg's on CR's there are aging timelines where the impact is lessened. I am not clear on what these timelines are for BK's, ch7 specifically.

I know that there are timlines for eligability in things - such as the 2 year rule post filing vs the 2 year rule post discharge.

My question: is there a score impact for reaching these milestones such as the 2 year one above? When someone becomes eligable for say, a mortgage after reaching this 2 year mark, will they also notice a change in score organically?

5 year? 7? I did a search and I do see data points where people suggest that they have increased scores as the BK ages, but I do not see any milestone data. Thoughts?

Re: Aging milestones for BK?

FireMedic1 — Mon, 06 Mar 2023 20:56:59 GMT

I've seen no age metric for the better in 7yrs. Dont believe there is one. BK hurts all the way thru the 10 yr period.

Re: Aging milestones for BK?

Lurker22 — Tue, 07 Mar 2023 13:11:20 GMT

@FireMedic1 wrote:
I've seen no age metric for the better in 7yrs. Dont believe there is one. BK hurts all the way thru the 10 yr period.

that is unless you have a 13 then it only hurts for the first 7 years (because 13's fall off after 7 years where 7's stay on for 10 years)

Re: Aging milestones for BK?

Horseshoez — Tue, 07 Mar 2023 14:25:30 GMT

@rosco75 wrote:
Hello all. I know that with many neg's on CR's there are aging timelines where the impact is lessened. I am not clear on what these timelines are for BK's, ch7 specifically.

I know that there are timlines for eligability in things - such as the 2 year rule post filing vs the 2 year rule post discharge.

My question: is there a score impact for reaching these milestones such as the 2 year one above? When someone becomes eligable for say, a mortgage after reaching this 2 year mark, will they also notice a change in score organically?

5 year? 7? I did a search and I do see data points where people suggest that they have increased scores as the BK ages, but I do not see any milestone data. Thoughts?

A few data points:

2013 - my wife and I separated due to financial pressures (we have since gotten back together)
2014 - she filed Chapter 7; her scores have improved a bit, but are still stuck in the low 700 with less than a year to go before the bankruptcy falls off her reports
2015 - I filed Chapter 13; my scores remained in the low to mid-600s throughout the 60-month bankruptcy
2020 - my bankruptcy was discharged and my scores inched up to the high-600s, only to be smacked back down to the low-600s when I started applying for credit.
2022 - my bankruptcy fell off my credit reports and all of my FICO scores shot up to 810 or higher (some had tip-toed into the 700 range before that, most never got there).
2024 - the assumption here is my wife's scores will see a similar bump as mine did last year

I told you that to tell you this, don't count on any significant score bump until your Chapter 7 ages out to 10 years.

Re: Aging milestones for BK?

Zoostation1 — Wed, 08 Mar 2023 01:53:56 GMT

I thought there were some datapoints to suggest on FICO 8 and 9 that dirty scorecards with a public record were segmented by how recent the PR is? That being said I don't know of any specific milestones either. It does seem like with a CH13, scores may stay heavily depressed for a longer period of time versus a CH7, despite fully rebounding on a clean card 3 years sooner than the CH7.

Re: Aging milestones for BK?

Jeffster1 — Wed, 08 Mar 2023 01:57:56 GMT

@Zoostation1 wrote:
I thought there were some datapoints to suggest on FICO 8 and 9 that dirty scorecards with a public record were segmented by how recent the PR is? That being said I don't know of any specific milestones either. It does seem like with a CH13, scores may stay heavily depressed for a longer period of time versus a CH7, despite fully rebounding on a clean card 3 years sooner than the CH7.

I'm definitely waiting on the EE of my 13 in early 2024.

Re: Aging milestones for BK?

Horseshoez — Wed, 08 Mar 2023 02:22:14 GMT

@Zoostation1 wrote:
I thought there were some datapoints to suggest on FICO 8 and 9 that dirty scorecards with a public record were segmented by how recent the PR is? That being said I don't know of any specific milestones either. It does seem like with a CH13, scores may stay heavily depressed for a longer period of time versus a CH7, despite fully rebounding on a clean card 3 years sooner than the CH7.

I don't believe I've ever heard of such an aging before; it certainly hasn't held true for my wife's scores even though she is now 9+ years since her discharge.

Prior to my Chapter 13 falling off my reports, my FICO 8 & 9 scores were as follows (EQ/EX/TU)

FICO 8: 697/684/725
FICO 9: 734/719/781

A month later my scores looked like this:

FICO 8: 835/817/815
FICO 9: 850/834/834

Re: Aging milestones for BK?

rosco75 — Wed, 08 Mar 2023 16:56:25 GMT

Thank you all for the feedback. I feel like im going to be stuck in the 680-700 range no matter how perfect my credit is aside from the BK. Thats disheartening for sure, but it makes that end date of 2030 that much sweeter I guess. Just sucks that I will not be able to buy a home at the prime rates for that entire 10 year period when one would think that year 8 or 9 youd have a better score due to aging. But Hey - I still feel that the BK was the best thing I ever could have done! Literally a mortgage has been the only downside of it thus far.

Re: Aging milestones for BK?

Horseshoez — Wed, 08 Mar 2023 18:10:12 GMT

@rosco75 wrote:
Thank you all for the feedback. I feel like im going to be stuck in the 680-700 range no matter how perfect my credit is aside from the BK. Thats disheartening for sure, but it makes that end date of 2030 that much sweeter I guess. Just sucks that I will not be able to buy a home at the prime rates for that entire 10 year period when one would think that year 8 or 9 youd have a better score due to aging. But Hey - I still feel that the BK was the best thing I ever could have done! Literally a mortgage has been the only downside of it thus far.

Just to level set, I don't think anybody is saying you're going to be stuck in the sub-700 zone for ten years. My wife, who has had a perfectly clean history since her discharge in early 2014 managed to recover up into the low-700s by mid-2016; today her scores hover between 720 and 749.

Re: Aging milestones for BK?

TRC_WA — Wed, 08 Mar 2023 20:11:43 GMT

@Zoostation1 wrote:
It does seem like with a CH13, scores may stay heavily depressed for a longer period of time versus a CH7, despite fully rebounding on a clean card 3 years sooner than the CH7.

@Zoostation1 @FireMedic1

I totally agree with this. I see so many Ch 7 filers with 700+ scores with their BR still reporting while I have been hovering between 650-670 for the last year since my 13 was discharged.

Are my scores tanking 30-50 pts because I'm carrying 20-25% UTI on my CC debt? Everything I read says to keep it under 30% which I am doing... on individual cards and across all cards. So why am I not 700 yet? I really feel like the PR is a lot more dead weight.

Hell, my TU report is my cleanest with only 1 PR and 1 derog account remaining due to EE... with EQ and EX both having more derog accounts... but yet TU is my LOWEST score.

Like I said in a post yesterday... when all 3 of my reports are clean by the end of the year only then will I know how much dead weight this Ch 13 PR is... because I just have a hard time believing that a low CC UTI is tanking my scores all that much... but then again... who knows. The other day my NFCU card went from a $0 balance to a $400 balance (20% UTI) and EQ/EX didn't move.... but TU dropped 10 points.

Makes no sense. It's almost as random as EE. Some people get lucky with super early deletions... others don't.

I'm paying my CC debt down in the coming months and I really am expecting 750+ when the baddies fall off.

Re: Aging milestones for BK?

Jeffster1 — Wed, 08 Mar 2023 20:16:26 GMT

@rosco75 wrote:
Thank you all for the feedback. I feel like im going to be stuck in the 680-700 range no matter how perfect my credit is aside from the BK. Thats disheartening for sure, but it makes that end date of 2030 that much sweeter I guess. Just sucks that I will not be able to buy a home at the prime rates for that entire 10 year period when one would think that year 8 or 9 youd have a better score due to aging. But Hey - I still feel that the BK was the best thing I ever could have done! Literally a mortgage has been the only downside of it thus far.

Not necessarily. My scores are in my sig. 700s and my BK is still reporting

Re: Aging milestones for BK?

Jeffster1 — Wed, 08 Mar 2023 20:46:08 GMT

I will say that, for people like me and @TRC_WA , it's easier to be patient since we are already almost bumping up against EE of our BK notations. I think the best advice I could offer is a repeat of the oft-repeated MyFICO forum adage..."It's not a sprint. It's a marathon."

Waiting is the hardest part.

I must also add that it is so much more pleasant chatting on this forum recently now that a couple of now-former moderators aren't jumping in and bullying people.

Re: Aging milestones for BK?

Jeffster1 — Wed, 08 Mar 2023 20:48:33 GMT

@rosco75 wrote:
Thank you all for the feedback. I feel like im going to be stuck in the 680-700 range no matter how perfect my credit is aside from the BK. Thats disheartening for sure, but it makes that end date of 2030 that much sweeter I guess. Just sucks that I will not be able to buy a home at the prime rates for that entire 10 year period when one would think that year 8 or 9 youd have a better score due to aging. But Hey - I still feel that the BK was the best thing I ever could have done! Literally a mortgage has been the only downside of it thus far.

Please always remember that. I feel the same way. BK was the best thing I could ever have done. In my case, I paid back 100 percent. Now, my paycheck goes in MY pocket; I now have savings; and I can look forward to an early retirement if I choose.

Godspeed.

Re: Aging milestones for BK?

TRC_WA — Wed, 08 Mar 2023 20:55:41 GMT

@Jeffster1

Yeah I'm plenty patient... just a little annoyed for reasons mentioned in my previous post.

I'm not applying for any more credit in 2023 though... got my new vehicle and new CC accounts... EE looks like TU July, EX October and EQ December if I'm lucky. I'll ring in 2024 with clean reports and minimal CC debt.

Working a side project right now... $8k over the next 30 days... and all of it is going to the CC's. After that I'll just be looking at leftover 0% on my Reflect that I don't have to finish paying til Aug.

Re: Aging milestones for BK?

Jeffster1 — Wed, 08 Mar 2023 21:15:15 GMT

@TRC_WA wrote:
@Jeffster1

Yeah I'm plenty patient... just a little annoyed for reasons mentioned in my previous post.

I'm not applying for any more credit in 2023 though... got my new vehicle and new CC accounts... EE looks like TU July, EX October and EQ December if I'm lucky. I'll ring in 2024 with clean reports and minimal CC debt.

Working a side project right now... $8k over the next 30 days... and all of it is going to the CC's. After that I'll just be looking at leftover 0% on my Reflect that I don't have to finish paying til Aug.

Sounds like a good plan. At least we are in the home stretch. I MAY apply for one more card this summer. I'm a couple months behind you on EE. Regular fall-off for me is 3/24.

I had made a killing on my 401K between 2017 and 2020, but was nowhere near old enough to withdraw and pay off my massive debt. Patelco was suing me. I filed. In 2020, after conferring with my attorney, I took a COVID withdrawal with only a portion of my 401K gain...paid off the remainder of my 13...got my DC 1.5 years early by changing to a 100 percent plan. I actually HAD to do something because, since I had gotten a large raise in 2019, the trustee would have come after me for more money anyway. Because of the raise and no debt, I built up savings and can now actually contemplate an early retirement. I've earned back all the money taken out of my 401K by upping my contributions plus I get a match.

If I hadn't filed when I did, I could not even imagine my life now.

Re: Aging milestones for BK?

TRC_WA — Wed, 08 Mar 2023 21:49:53 GMT

@Jeffster1 wrote:

If I hadn't filed when I did, I could not even imagine my life now.

@Jeffster1

Same here... a gambling problem led to my Ch 13. Long story but I'm good now. My fall off is Jan 2024... so yeah... a couple months sooner than yours.

I did well with the stock market when Covid hit... I am a big vacationer and dumped $10k from my 401k into cruise line and airline stocks... literally the day they took a massive nosedive in March 2020.

Sold everything in September at almost 4x what I paid... and I still sold them too early. I showed a buddy of mine my overall gain and he was like "you'll never do that again."

Probably not.

Re: Aging milestones for BK?

FireMedic1 — Thu, 09 Mar 2023 09:44:10 GMT

@Lurker22 wrote:
@FireMedic1 wrote:
I've seen no age metric for the better in 7yrs. Dont believe there is one. BK hurts all the way thru the 10 yr period.
that is unless you have a 13 then it only hurts for the first 7 years (because 13's fall off after 7 years where 7's stay on for 10 years)

@Lurker22Ive seen no age metrics for the better in 7 yrs. That's me 7 yrs out. Thank for the update on fall offs. Seriously?

Re: Aging milestones for BK?

Lurker22 — Fri, 10 Mar 2023 13:52:55 GMT

@FireMedic1 wrote:
@Lurker22Ive seen no age metrics for the better in 7 yrs. That's me 7 yrs out. Thank for the update on fall offs. Seriously?

wasn't suggesting there was any change within those 7 years - I'm at year 5.5 myself and can't wait for it to fall off next year

Re: Aging milestones for BK?

rosco75 — Thu, 09 Mar 2023 13:37:50 GMT

I agree with you guys - it certainly is the hardest part! (waiting)

I had filed due to identity theft while in Afghanistan. Fighting it was costing way more than I had, and the damage was just compiling. Thank god i decided to talk to a lawyer who told me that it would be far quicker and easier to file. I wish I had done so sooner!

My scores all hover somewhere around 680-690, and I can squeeze them juuuuuuuuust into 700 barely by doing AEZO and keeping under 9%, which is what I wanted to say to you @TRC_WA - I feel like you are not giving the high UTIL enough wieght here. I firmly believe, through my own experience, that if you got your overall util down under 9% then you would indeed see a large increase in points. Its the only reason I think my scores are so high being just reaching my 2 year mark on my ch7 BK. I have a car loan, over 3 credit cards, and am just missing the mortgage to hit that "thicc" profile but im not a thin one i think.

The only thing that confuses me about scoring metrics and the BK is that the accounts (trade lines) which show derogs as IIB - im still not clear how those are factored in. Meaning if they are more or less of an impact than they would be without being included in bk. Not sure if that makes sense.

Anyway - off to the casual jog of this marathon, hope you all do well and I am thankful for this forum and the positivity it has brought me and my life. I am SO MUCH better managing my overal finances and have far greater knowledge than I would otherwise by being here!

Re: Aging milestones for BK?

donkort — Thu, 09 Mar 2023 13:48:47 GMT

I would guess that the "milestones" would consist of keeping alive credit even in the midst of bankruptcy. And being diligent about maintaining good credit habits.

Were it not for MYFICO, I would have assumed that my credit would have automatically been in the toilet for all the seven years of my (hypothetical) BK13.